Rambus - Q1 2024
April 29, 2024
Transcript
Operator (participant)
Welcome to the Rambus First Quarter Fiscal Year 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. At the conclusion of our prepared remarks, we will conduct a question and answer session. If you would like to ask a question, you may press star one on your touch-tone phone at any time. If anyone should require assistance during the conference, please press star zero at any time. As a reminder, this conference call is being recorded. I would now like to turn the conference over to Desmond Lynch, Chief Financial Officer. You may proceed.
Desmond Lynch (CFO)
Thank you, Operator, and welcome to the Rambus First Quarter 2024 Results Conference Call. I am Desmond Lynch, Chief Financial Officer at Rambus, and on the call with me today is Luc Seraphin, our CEO. The press release for the results that we will be discussing today has been filed with the SEC on Form 8-K. A replay of this call will be available for the next week at 866-813-9403. In addition, we are simultaneously webcasting this call, and along with the audio, we are webcasting slides that we will reference during portions of today's call. A replay of this call can be accessed on our website beginning today at 5:00 P.M. Pacific Time.
Our discussions today will contain forward-looking statements, including our expectations regarding projected financial results, financial prospects, market growth, demand for our solutions, and other market factors, and the effects of ASC 606 on reported revenue, among other items. These statements are subject to risks and uncertainties that may be discussed during this call and are more fully described in the documents we file with the SEC, including our 8-Ks, 10-Qs, and 10-Ks. These forward-looking statements may differ materially from our actual results, and we are under no obligation to update these statements. In an effort to provide greater clarity in the financials, we are using both GAAP and non-GAAP financial presentations in both our press release and on this call.
A reconciliation of these non-GAAP financials to the most directly comparable GAAP measures has been included in our press release, in our slide presentation, and on our website at rambus.com on the Investor Relations page under Financial Releases. In addition, we will continue to provide operational metrics such as licensing billings to give our investors better insight into our operational performance. The order of our call today will be as follows: Luc will start with an overview of the business, I will discuss our financial results, and then we will end with Q&A. I'll now turn the call over to Luc to provide an overview of the quarter. Luc?
Luc Seraphin (CEO)
Thank you, Des, and good afternoon, everyone. In Q1, we continued our disciplined execution as we remained strategically focused on addressing the needs of traditional and AI servers. In the quarter, we expanded our market opportunity with the introduction of new leadership products and performed well across all of our businesses. With that, we delivered solid Q1 results, and demonstrating our ongoing commitment to stockholder return, we completed the $50 million accelerated share repurchase, which brings the total return of cash to our stockholders over the past three years to $350 million. With strong execution, we delivered first-quarter product revenue of $50 million and also continued our investments in new products to drive future growth. As the accelerated pace of new compute platform rollouts continues, we have multiple generations of DDR5 RCDs progressing through different stages of qualification and production, and the latest generation sampling to customers.
We are, therefore, well-positioned for the DDR5 product cycle and expect this to drive approximately 10% product revenue growth in the second quarter. Additionally, we are confident in the longer-term outlook for the data center beyond the current softness in the traditional server market. While we continue to see modest consumptions of DDR4 customer inventory, the industry is moving in earnest to DDR5, and the transition is amplified by increasing demand for performance from generative AI and other advanced workloads. The rapid evolution of traditional and AI servers requires the constant advancement of new products and architectures to address the growing memory performance requirements. As such, expanding our leadership product portfolio to meet these requirements is a key element of our long-term growth strategy.
In line with that strategy, we just announced the expansion of our chip offering with the availability of our new family of DDR5 server PMICs, completing our memory interface companion chipset for DDR5 RDIMMs. This new product line includes the industry's first extreme current server PMIC that will enable high-bandwidth, high-capacity DDR5 modules for leading-edge servers in the data center. We are currently in qualification with major memory vendors and are receiving positive feedback. Power management solutions are a critical and challenging component of today's server memory subsystems. In order to achieve the increased bandwidth and capacity of DDR5, the industry made a major change to the power management architecture by moving the PMIC from the motherboard to the individual memory modules.
The resulting DDR5 server PMICs are required to deliver reliable power at the lower voltages and tighter tolerances of the latest DRAM chips while operating in a very challenging environment. We have built upon our memory subsystem expertise and proven track record of delivering robust module-based solutions to deliver a PMIC family optimized for efficiency power delivery under demanding noise, thermal, and space conditions. Given our heritage and mission to advance memory performance, we identified power management as a critical technology to unlocking higher memory bandwidth and capacity. We made the strategic decision to invest, build a world-class team, and are now intercepting the market with leadership products to address the need. This new server PMIC product family amplifies our market opportunity and lays the foundation for our roadmap of future power management chips.
As AI expands from training to inference, continued advances in the data center and AI are also driving momentum in our silicon IP business with strong design wins led by HBM, CXL, PCI Express, and Security IP. With the industry's most advanced interface and Security IP portfolio for AI, we are making great progress and are on track for our annual growth targets. As part of our continual leadership, we introduced the industry's first GDDR7 memory controller, which delivers the performance needed by next wave of inference chips for edge AI. The ever-increasing volume of data is pushing chip interface speeds and memory bandwidth requirements higher and higher. At the same time, the value of the data itself is also going up, and with that, so does the risk and impact of a breach.
Our differentiated silicon IP solutions offer chip designers top-of-the-line performance and advanced protection against attacks, making them essential to enabling faster and more secure SoCs for the data center and adjacent markets. As we look forward, generative AI and other data-intensive workloads will further accelerate the demands on performance and security across the computing landscape. We continue to focus on the ongoing scaling of memory capacity and bandwidth through novel memory form factors and architectures, such as multi-rank solutions and serial-attached memory, that will be critical to improving efficiency and performance in computing systems from the data center to client. In addition, ongoing advancements in security, including quantum-safe solutions, will be essential to protecting valuable hardware and data.
As demonstrated this quarter, through our newly introduced offerings, we continue to execute on our product roadmap for both chips and IP, unlocking new levels of system performance and expanding our market opportunity. Recent announcements by leaders in the AI industry serve as proof points of the importance of memory for system performance improvement, with the latest systems featuring more than double the memory bandwidth and capacity. As we look forward, those requirements will only grow, and our strategy and roadmap are well aligned to address the market needs. In closing, Q1 was a solid quarter for the company that was achieved through disciplined execution of a clear strategy. We delivered on our commitments across the board and continued our innovation in the market.
Our focus on high-performance products for the data center and AI positions us well to drive the long-term profitable growth of the company, and our strong balance sheet enables us to deliver consistent return of value to our stockholders. As always, I'd like to thank our customers, partners, and employees for their ongoing support. And with that, I'll turn the call over to Des to discuss the quarterly financial results. Des?
Desmond Lynch (CFO)
Thank you, Luc. I'd like to begin with a summary of our financial results for the first quarter on slide 5. We delivered solid results in the quarter as a result of the company's ongoing disciplined execution and focus on our strategic initiatives. We are pleased to have launched our new power management products, which demonstrate the translation of new product investments to expanded market opportunity. Continuing our strong track record of returning cash back to stockholders, in Q1, we executed a $50 million accelerated share repurchase program that retired approximately 800,000 shares. Through our robust balance sheet driven by our strong cash generation, we have returned a total of $350 million in cash to our stockholders over the last three years, which shows our consistent commitment to capital return. Let me walk you through our non-GAAP income statement on slide 6.
Revenue for the first quarter was $117.9 million, which was above our expectations. Royalty revenue was $47.5 million, while licensing billings was $63.2 million. The difference between licensing billings and royalty revenue mainly relates to timing, as we do not always recognize revenue in the same quarter as we bill our customers. Product revenue was $50.4 million, consisting primarily of memory interface chips. Contract and other revenue was $20 million, consisting predominantly of silicon IP. As a reminder, only a portion of our silicon IP revenue is reflected in contract and other revenue, and the remaining portion is reported in royalty revenue as well as in licensing billings. Total operating costs, including cost of goods sold for the quarter, were $74.2 million.
Operating expenses of $53.7 million were in line with our expectations as we continue to be disciplined in our expense management, and we ended the quarter with a total headcount of 622. GAAP interest and other income for the first quarter was $4.2 million, which includes $200,000 of ASC 606 interest income. Using an assumed flat tax rate of 22% for non-GAAP, pre-tax income, non-GAAP net income for the quarter was $37.4 million. Now, let me turn to the balance sheet details on slide 7. We ended the quarter with cash, cash equivalents, and marketable securities totaling $391.1 million. This is down from Q4 mainly due to the $50 million accelerated share repurchase program that we completed in the quarter. Cash from operations for the quarter was $39.1 million. First quarter CapEx was $7 million, while depreciation expense was $6.1 million.
We delivered $32.1 million of free cash flow in the quarter. Now, let me turn to our guidance for the second quarter on slide 8. As a reminder, the forward-looking guidance reflects our current best estimates at this time. We continue to actively monitor the macro environment, and our actual results could differ materially from what I'm about to review. In addition to the financial outlook under ASC 606, we also provide information on licensing billings, which is an operational metric that reflects amounts invoiced to our licensing customers during the period adjusted for certain differences. As we have reported historically, licensing billings closely correlate with what we had historically reported as royalty revenue under ASC 605. Under ASC 606, we expect revenue in the second quarter to be between $130 and $136 million.
We expect royalty revenue to be between $55 million-$61 million, and licensing billings between $61 million-$67 million. We expect Q2 non-GAAP total operating costs, which includes COGS, to be between $80 million-$76 million. We expect Q2 CapEx to be approximately $13 million. Under ASC 606, non-GAAP operating results for the second quarter are expected to be between a profit of $50 million-$60 million. For non-GAAP interest and other income and expense, we expect $3 million of interest income. We expect the pro forma tax rate to be approximately 22%, with non-GAAP taxes expected to be between an expense of $12 million-$14 million in Q2. We expect Q2 share count to be 109 million diluted shares outstanding. Overall, we anticipate the Q2 non-GAAP earnings per share range between $0.38-$0.45. Let me finish with a summary on slide 9.
I am pleased with the team's continued execution as we navigate dynamic market conditions in the short term. We are pleased to see continued momentum across all of our businesses, fueled by our leading-edge products in both chips and silicon IP. Our innovation, diversified portfolio, and discipline model continues to drive profitable growth and strong cash generation. Our solid balance sheet enables investments into market expansion opportunities in the data center and AI, while consistently delivering value to our stockholders. Before I open up the call to Q&A, I would like to thank our employees for their continued teamwork and execution. With that, I'll turn the call back to our operator to begin Q&A. Could we have our first question?
Operator (participant)
Thank you. Ladies and gentlemen, if you have a question, please press star one on your touch-tone phone. And the first question is from the line of Gary Mobley with Wells Fargo. You may proceed.
Gary Mobley (Analyst)
Hi, guys. Thanks for sure. Thank you. Thanks for taking my question, guys. With the product revenue expected to increase about 9% sequentially, is that an indication of the market turning more positive specific to Registered Clock Driver sales? Then maybe you can parse out some distinction between DDR4 and DDR5. Then related to the companion chip sales, maybe if you can share with us your latest view on the timing of ramp for those companion chips. Thank you.
Luc Seraphin (CEO)
Thanks, Gary, for your question. So yeah, we are pleased with the execution for the first half of this year. We had solid results in Q1, and we expect, as you said, growth into Q2. We still see, for the fourth quarter in a row, a slight decline of DDR4 inventories, which is a good sign. Our predominant sales continue to be DDR5 into the first half. But what we see going into the second half of the year is that we expect a modest recovery in DDR4 following the inventory digestion.
We also expect a recovery in the standard server demand with a refresh cycle coming on board. We will start to see more contribution from our companion chips, the two companion chips that we already had sampled to customers in prior quarters, but also now with our newly introduced PMIC. So we do see growth in the second half based on these three main factors.
Gary Mobley (Analyst)
Okay. I had a follow-up about your silicon IP business. You mentioned in your prepared remarks that you're on track for your fiscal year 2024 targets, refreshing my memory. Is that $120 million in annual sales in that business? And maybe if you can give us a sense of how that business seems to be performing better than expectations, is it driven by the memory and high-speed SERDES controller IP, or is it driven by more so the security side of the business?
Desmond Lynch (CFO)
Hi, Gary. It's Des here. We're very pleased with our performance in silicon IP. If you take our adjusted number from last year, which excludes the PHY divestiture, this was about $110 million. What we've talked about is growing the business 10%-15% in line with our long-term targeted growth rate. What we've seen in the first half of the year, if you take our Q1 actuals plus the midpoint of our guidance, that we will be up double digits in the silicon IP revenue, which is really driven really across all components of our portfolio. We're seeing strong performance by our security revenue, really led by Root of Trust and MACsec Solutions. Also on the interface side, we're also seeing really nice growth across HBM, CXL, and PCIe.
Gary Mobley (Analyst)
Thank you, guys.
Luc Seraphin (CEO)
Yes. And what I would add to this, Des, is we've really worked on our silicon IP offering focus. So if you look at the type of IP we provide, they are really well targeted to AI type of applications. We have several generations of HBM in the market: HBM2, HBM2e, HBM3, HBM3e, which we announced in Q4 of last year. We have PCIe from PCIe 3 to PCIe 6. We announced last quarter CXL 3.1. And on the security IP, as Des mentioned, with all of these data moving around into these fragmented architectures, the importance of security becomes more and more important. So last year, we refocused our IP portfolio. We're doubling down on that portfolio. And that explains the growth that we're starting to see with that very focused portfolio for AI in particular.
Gary Mobley (Analyst)
Thanks again.
Luc Seraphin (CEO)
Thank you, Gary.
Operator (participant)
Thank you, Gary. The next question is from the line of Mehdi Hosseini with SIG. You may proceed.
Mehdi Hosseini (Analyst)
Yes, sir. Thanks for taking my question. Two follow-ups from my end. Just double-clicking on silicon IP, it's been kind of flattish into the Q2. Should we expect additional incremental revenues so that you would have growth on a Q over Q into the second half? I'll have a follow-up.
Desmond Lynch (CFO)
Hi, Matthew. It's Des. That's a good question. As I mentioned just to Gary a minute ago, we saw a sort of 10% growth if you take the first half of 2024 and compare that against 2023. We're performing very well. I think Luke gave some really nice color on some of the drivers we're seeing on the growth. We do expect that that will continue to grow into the back half of the year, given our expanded sort of offering that Luke talked about. We're seeing really nice traction on the controller side as well as the security side. So we do expect to see sequential growth on our silicon IP business as we move throughout the year.
Mehdi Hosseini (Analyst)
Okay. So the first half to second half commentary, it was more of an overall revenue. It wasn't just a product revenue, right?
Desmond Lynch (CFO)
The comment was relating to silicon IP revenue, Matthew, from there, the 10% growth. I think Luc also mentioned in his prepared remarks that if you take the Q2 guidance midpoint on the product side, we are seeing almost double-digit growth on the product revenue side as well. So we're performing very well in Q2 from there.
Mehdi Hosseini (Analyst)
Sure. And with the higher mix of DDR5, should I also expect gross margins finally to show meaningful improvement in the second half of the year, gross margin for product revenues?
Desmond Lynch (CFO)
Yeah, that's the way I would think of it, Matthew. In Q1, our gross margins were approximately 61%. That was anticipated by us. As we move throughout the year, what we will see is a higher concentration mix of DDR5 on some of the new products that are coming out. And we'll continue to be disciplined in our ASP management. And as always, we will continue to drive product cost reductions to maintain our healthy product gross margins. But overall, for the year, I would expect our product gross margins to be in line with our long-term gross margin target of 60%-65% on the products.
Mehdi Hosseini (Analyst)
Gotcha. Thank you.
Gary Mobley (Analyst)
Thanks, Matthew.
Operator (participant)
Thank you, Matthew. The next question is from the line of Kevin Cassidy with Rosenblatt. You may proceed.
Kevin Cassidy (Analyst)
Yeah. Thanks for taking my question, and congratulations on the solid results. Just then, as we're coming into the second half of the year, as you mentioned, there's product refresh. Can you give us an idea of the mix that you're expecting to ship of DDR5 RCDs that are Gen 1, 2, and 3?
Luc Seraphin (CEO)
Thanks, Kevin. That's a difficult question. We have actually three generations of DDR5 layering up. There are different stages of qualification and production with different customers. So it makes our life a little more challenging in terms of managing the backlog and the inventory. But we do see DDR5 growing in earnest. Gen 1 is well in production. Gen 2 is ramping, and we're shipping parts for the preparation of Gen 3. And depending on the modules and depending on the customers, we have different stages of qualification and production. What we can say is, as we said earlier, DDR5 remains small for the first quarter. DDR4 remains small for the first quarter. We expect some slight recovery on DDR4 starting in the second half. But we expect this to be having a long tail. The majority of our business will continue to be DDR5 across those generations of DDR5.
Kevin Cassidy (Analyst)
Okay. Great.
Desmond Lynch (CFO)
Kevin, maybe just to add on to what Luc said, regardless of what generation ships on DDR5, we have a strong qualification footprint across all generations, and we're really pleased with our market position on DDR5.
Kevin Cassidy (Analyst)
Yeah. Thanks, Des. That goes right to my next question. I was wondering what the competitive landscape is and if there's any lead time issues.
Luc Seraphin (CEO)
On the lead time issues, there are no lead time issues. I think from a supply standpoint, we are in good shape. As Des mentioned, in terms of qualification, as we move from generation to generation, our footprint continues to improve. Depending on the mix of these three generations throughout this year, whatever that mix is, we feel confident with that DDR5 ramp in the market. Our footprint across the generations of DDR5 is larger than what we had in DDR4. That market transition is positive for us.
Kevin Cassidy (Analyst)
Okay. Great. Thank you.
Luc Seraphin (CEO)
Thanks, Kevin.
Operator (participant)
Thank you, Kevin. The next question is from the line of Nam Kim with Arete Research. You may proceed.
Nam Kim (Analyst)
Thank you, Mike. Question. One question for PMIC and the other one as a follow-up. Can you provide us some reasons on why you believe your PMIC is better than existing PMIC suppliers like incumbent companies? And what's your target market share goal in PMIC and RDIMM?
Luc Seraphin (CEO)
Thank you, Nam. If I understood your question well, your question was why we're introducing PMIC against the incumbents and how we expect to grow share. The line is in.
Nam Kim (Analyst)
Oh, you changed it a little. Did you think?
Yeah. Yeah. Competitiveness on your PMIC. What aspect of your PMIC is better than incumbent PMIC chip?
Luc Seraphin (CEO)
Thank you. Thank you, Nam. So yeah, let me give you a little bit of color regarding the announcement we just made on PMIC. As the workloads for traditional servers and AI servers continue to increase, we believe that power management has become a critical component on the system performance of the DIMM. As you know, the power management chip distributes power in a reliable manner to different power domains that sit on the RDIMM. And RDIMM is very, very dense. It's one of the most dense electronic systems that you can find, and you have to deliver that power.
This power management chip must demonstrate efficiency, how much power you use for the power you deliver, accuracy and stability because of the tolerances of the Desices on these DIMs, but also a good behavior when you ramp up or ramp down power. It's a very complex chip. We thought that at Rambus, this is going to become a core competency in the long run. We have invested in power management for a couple of years now. We're still growing the team and the investments in that area. We are capitalizing on our deep understanding of the DIM at the system level, which I think is really, really important. As you saw in the announcement, we talk about the extreme PMIC, which is the name specified by JEDEC.
The extreme PMIC is actually a PMIC that goes into the most challenging DIMs in terms of speed and density. We targeted that because this is where we could show that we could have products that were better than our competitors by targeting the most difficult ones to do. We have sampled customers in some large quantities now. We are in the qualification process. The feedback we have from customers on that most difficult PMIC to make is very, very positive. In the long run, what this tells us is that this extreme PMIC performance and our ability to make them is going to trickle down other applications for the high-current PMIC, the low-current PMIC, but also for PMICs that will be used in other systems down the road. The first PMIC is the extreme PMIC. That's a very difficult one to make.
It's targeting high-density, high-bandwidth DIMs. We've got really good results with customers, and this is what gives us confidence in this. I would end by saying, if you look at a DIM at Rambus, we always say that it's about signal integrity. Signal integrity is about the RCD. It's about power integrity. Power integrity is about the PMIC. We're very excited. We've worked on this for a couple of years. We're introducing one product at this point in time, one product family. Over time, it's going to trickle down the different applications in memory subsystems.
Nam Kim (Analyst)
So it sounds like a target really, AI server, which requires very high bandwidth and high capacity. Is that right? And what's your target market share in PMIC in the longer term?
Luc Seraphin (CEO)
So it is true that if you take a CPU and an AI server, they typically maximize the number of DIMs per channel, but they also try to maximize the density. So definitely, the extreme PMIC is a good or the AI servers are a good target for the extreme PMIC. So you're absolutely right with that. In terms of market share, we've always said that we target in the long run to get to 20% share when we are in full production, fully qualified on our PMIC family. But we're going to ramp our way through that. We're going to ship initial volumes in the second half of this year. We're going to see some production volume next year. And our target is to eventually get to 20% share.
Nam Kim (Analyst)
Okay. Thank you. One more question, if I can, then I will be back in queue. Do you find prices having been increasing quite dramatically since December quarter last year? I'm just curious on RCD pricing going forward. Is the RCD chip price usually just stable relative to RDIMM price, or do you think there's some room to raise the price when RDIMM prices are up quite significantly? Thank you.
Luc Seraphin (CEO)
Thank you. Now, typically, the RDIMM prices and the RCD prices are not correlated. The RDIMM prices go with DRAM supply and demand situation. The RCD prices are typically defined by the competitive environment on the RCD supply. So there's no correlation between the RDIMM prices and the RCD prices. The only thing I would add, though, is that when we move from generation to generation, from DDR5 Gen 1 to DDR5 Gen 2 to DDR5 Gen 3, there's an uptick in pricing on the RCD that has to do with the introduction of new technology. But as these technologies ramp into production, we see the standard price erosion on each one of those generations.
Nam Kim (Analyst)
Thank you. Thank you very much.
Luc Seraphin (CEO)
Thank you, Nam.
Operator (participant)
Thank you, Nam. As a quick reminder, if you would like to ask a question, please press star 1. And our next question is from the line of Mehdi Hosseini with SIG. You may proceed.
Mehdi Hosseini (Analyst)
Yes, sir. Thank you. Just a couple of follow-ups. Actually, for the team, when do you expect incremental PMIC revenue to start impacting the top line? And would PMIC also be in the product revenue?
Desmond Lynch (CFO)
Hi, Mehdi. It's Des. As Luc mentioned, we're very pleased to announce our PMIC solutions today. We do expect to have a revenue contribution in the second half of the year, and that will continue to grow into 2025, as Luke mentioned, into the production volumes then. You are correct that this will show up under product revenue. That's the right categorization for the PMIC revenue.
Luc Seraphin (CEO)
Okay. Then just a clarification on the product gross margin, 60% Q1. I think I heard you saying that most of the products were for DDR5. Is there a startup cost associated with your foundry partner, or what is it that is adversely impacting your Q1 product gross margin? I'm under assumption that DDR5 has a higher gross margin than DDR4.
Desmond Lynch (CFO)
Hey, Mehdi. It's a good question. As it relates to our product gross margins, we continue to manage these for the long term, and we do have a healthy gross margin profile. If you take last year, 2023, for the full year, it was 63% on the gross margin side. In Q1, our gross margins on the product side were approximately 61%, which was down from 63% in Q4, Mehdi. The sequential decline in gross margin was driven by anticipated ASP erosion, which was in the low single digits. And we also did have some one-time manufacturing costs that were incurred in Q1. As a company, we have been and will continue to be disciplined in our ASP management, and we will continue to drive product cost reductions to maintain our healthy product gross margins.
Overall, for the year, I would expect that our product gross margins will be in line with our long-term target of 60%-65%.
Mehdi Hosseini (Analyst)
Sure. And if I may, just excuse me, one more follow-up. And this is also for the team. What happens if demand for DDR4 actually were to be there, especially for some of the low-end server applications or even maybe for inferencing? Are you anticipating just focusing on DDR5, or would there be a scenario where DDR4 actually there is no end of life and there will be kind of a steady demand for it?
Luc Seraphin (CEO)
We expect to have some long-term demand for DDR5. We see Gen 1 in production today. Gen 2 has been launched. We have customer orders on Gen 2. We have customer orders on Gen 3 as well. Gen 4 was introduced, and we were the first ones to introduce Gen 4 in December of last year. And the industry is anticipating to continue to Deselop DDR5-based solutions for the data center.
We expect that to continue. With respect to DDR4, as we said earlier, we see a long tail of DDR4 demand, not necessarily high. The vast majority of sales going forward is going to be for the data center, is going to be DDR5.
Mehdi Hosseini (Analyst)
Okay. Thank you.
Luc Seraphin (CEO)
Thank you, Mehdi.
Operator (participant)
Thank you, Mehdi. At this time, there are no further questions. This concludes the question-and-answer session. I would now like to turn the conference back over to Luc Seraphin.
Luc Seraphin (CEO)
Thank you, everyone who have joined the call with us today. Thank you for your continued interest and time. We look forward to speaking with you again soon. Have a great ay. Thank you.
Operator (participant)
Thank you. This now concludes today's conference.